Reference no: EM132664540

Yna Co. records all disbursements using nominal accounts (i.e., expense method). On December 31, 20x1, Yna Co. has total expenses of ?2,000,000 before considering the following:

a. Advertisement costs paid in January 20x2 totaled ?20,000. The advertisement was aired on TV on December 28, 20x1.

b. A three-year insurance on assets was obtained on August 1, 20x1 for ?108,000.

c. On July 15, 20x1, Yna Co. entered into an operating lease requiring monthly payments of ?120,000 starting on the date of the lease contract and monthly thereafter.

d. Office supplies expense has a balance of ?140,000. The physical count of office supplies revealed a balance of ?132,000.

Problem 1: How much is the 20x1 adjusted total expenses?

a. 1,859,000

b. 1,735,000

c. 1,765,000

d. 1,695,000